If you want to hack someone's network then learn your target. This starts with recon. What does your target run? What information can you find out about them? Remote scanning will tell you lots about a target system ... unless their sysadmins are good and have changed all the banners to throw you off.

So you learn about the people involved. Who are they? Have any of the technical staff or managers done talks? Where did they work before? People are sloppy and leave information lying around all over the place ... and the internet is forever.

That talk or blog about how a big problem was solved can give you lots of clues about how a company's network is designed, what applications they use and so forth. Social media feeds are a gold mine; techs love nothing more than to complain about frustrating applications, or talk about new ones that they are trying out.

A really good hack can be months or even years in the recon stage. It probably involves building a duplicate network in your own lab at which you can make dry runs.

Cloud offerings can really help with this because the more people use public cloud computing, the more they are using a pre-canned offering that you can duplicate with a minimum of effort. After you know all that you are likely to know, you move to coding stage.

The coding stage overlaps recon somewhat, in that a lot of the recon stage will be spent designing the code you'll be using to attack your target. You'll need to assemble a list of exploits you can try, based on what you know the target runs. You'll also want to learn the operating systems, monitoring solutions and intrusion detection systems in play so that you can hide your tracks.

The coding stage is assembling your payloads into deployable weapons. You might need to try several before you find one that managed to get you a beachhead into the target network. Once there, you can then spool out your payloads onto different systems – covering your tracks the whole time – and deploying your other beachhead tools (including those which failed; they may work from behind the perimeter) to make sure that you have multiple access points.

All of this is a lot of work, but gaining access to a network is the easy part.

Sneaking out is always hard

There is an economic incentive for companies not to pay too close attention to people trying to sneak in to their networks. Simply put: if they don't know about it, they can't be held accountable. Companies can point to the industry-standard, off-the-shelf security solutions they've deployed and say they did their due diligence.

On the other hand, companies are absolutely paranoid about people trying to remove data from the network. They're also paranoid – for completely different reasons – about what their staff might be doing with the company network. Are the proles wasting time on Facebook? The bigger the company the more likely they will see every single bit that leaves the network.

If you manage to embed a remote access application in your target's network making it something that people won't notice is actually pretty easy. Have it talk something innocuous or nerdy. Nobody really notices SSL traffic to a website hosted on Amazon.

If you have a legitimate looking website living in a VM on Amazon then you can have your remote access tool talk to an API interface buried at some sub-URL in order to exchange commands. So long as the traffic usage isn't high, it will probably be overlooked.

However, try to pull 2TB worth of data off of that network and alarms will go off everywhere.

Large volume transfers are suspicious. Protocols such as RDP are suspicious. SSH maybe not so much, but that really depends on the company. Many are getting wise to it.

Everyone monitors cloud applications such as Dropbox nowadays, so you're not going to take your bounty, stuff it into a cloud storage application, and use that to exfiltrate data unless your target's sysadmins are massively underfunded. Similarly, if there's this connection to a random website on Amazon that's open for eight consecutive months, always at exactly 50KiB/sec, someone will eventually notice.

This is why bulk data theft is so much rarer than simple compromises to mine bitcoin, pump out spam or encrypt everything and demand ransom. Getting in is easy. Getting out is hard.

Hacking from the back of beyond

You don't need a good internet connection to hack. Most hacking isn't real time anyways; you use robots and scripts to do the leg work because they are more precise than humans. If the robots you send in to do the job are well coded then they won't forget things when they're tired and they won't get caught.

This means that you can hack a target over the crappiest network connections available. If you can get enough bandwidth through whatever series of relays and anonymisers you are using to your virtual machine on Amazon, then you can use that virtual machine to issue all the commands you want. It has great network connectivity. You just need to pass it some text and the occasional script file.

You probably need a lot more downstream bandwidth than upstream, because you need to comb through directory listings, the results of searches and filters, etc. This, however, is still all text and you can still functionally push it through a wet string. It should be pointed out that today's satellite connections are more than up to the task of this sort of work.

The network connectivity to do the recon portion of the exercise is orders of magnitude higher, but it also isn't time sensitive. Data that's exfiltrated can be stored and manipulated in the public cloud, to be slowly downloaded over crappy infrastructure at the attacker's leisure.

All of the above should serve as a lesson – hopefully more of a reminder – for those who are defending. Good attackers try to hide in plain sight.

Network defence focused solely on keeping the bad guys out will fall to any remotely skilled crew. Proper defence is going to rely on catching them once they've managed to get past the outer defences, and on preventing them from extracting any payloads once they're in.

The Register commenter Yet Another Anonymous Coward had a topical comment titled "Let me get this straight", saying that "The world's most backward country executed the world's most advanced cyber attack and chose as its target the American subsidiary of a Japanese entertainment company?"

"Or, perhaps it has secretly infiltrated every other military and government computer system in the west and are actually running everything?"

Neither possibility should be particularly surprising.

Hacking isn't hard

First off, let's start with the statement that I don't have any idea if North Korea did, in fact, hack Sony. It may have. It may not have. You can't trust anything North Korea has to say on the matter. Sadly, we also can't trust anything any of our governments say.

That all said, I absolutely believe North Korea has the capability to do this. Yes, North Korea is backwards. It doesn't have enough bombs and missiles and guns to really make anyone except South Korea really sit up and take notice.

Even South Korea isn't really all that worried, because if you tried to get those bombs and missiles and guns from A to B then everyone on earth would see it happening and a cloud of cruise missiles would rain down on the North Korean military movement, making for a short but exciting news cycle.

North Korea's leadership know this. So what's a megalomaniacal false demigod of a leader to do in order to strike at the hearts of his perceived enemies? Develop "cyber" capabilities. Being a good hacker doesn't take some mystical skill. It doesn't take a super computer and it doesn't take a country full of cloud providers.

A half decent hacker can penetrate almost any system with nothing more than a netbook and good operational security. You can use any operating system or device if you know your tools well enough, or you write good enough tools. For the difficult hacks you're realistically going to have to do both.

We portray hackers as people who have a stroke of genius and then mash the keyboard really hard and poof! They've reversed the polarity on the tachyon inverter and suddenly used the thermostat to overwrite the hidden sectors on the tablet that controls the nuclear reactor. Oh noes!

State-level hacking

Anyone who has the resources to hire a full-time research team and a pair of decent developers can build credible offensive hacking capabilities. This means that most 50-individual companies on the planet theoretically have the resources to build both malware and network-based deployment capabilities.

Not only does this make every government on earth a threat, but by dint of the low cost of developing this capability, industrial espionage hacking teams are guaranteed to be practically everywhere. Organised crime will, without question, have extensive capabilities as well.

The idea of "state-level" capabilities moves the needle a bit, but in all honesty not by much. The primary advantage that state sponsorship brings to a hacking team is not additional nerds or computer infrastructure. It is spies and saboteurs.

Governments have people around the world, or they can hire mercenaries and consultants to get the job done. People cost money and this means that only a handful of organisations can manage the global reach of even a small government.

Any large enterprise has the financial resources to develop this capability. The large organised religious groups would as well. The larger organised crime groups have global reach, but many are loose collections of small families or clans and may not have the cohesion for unified long-term investments on this level.

Network activist and hacktivist body Anonymous and other loose – but large – populist collectives or organisations could theoretically bring state-level resources to bear. In the case of Anonymous it would be easier to herd cats than to develop any true state-level offensive capabilities, but there are plenty of non-commercial, non-governmental, non-religious organisations with global presences to be considered, and state-level hacking capabilities are more about the ability to physically access networks, people and research resources than the software cooked up by the nerds.

I don't doubt that North Korea could have cut through Sony's defences like they weren't even there. Every state-level actor out there could probably go through most corporate or personal networks with similar ease. This doesn't, however, mean that these state-level actors could get into an actively well defended network.

Beyond state-level: defending your IT world

Defending a network properly costs a lot of money. If you want to do it, you cannot simply rely on off-the-shelf software and tools. You need to hire hackers to defend against hackers. People who are trained in operational security and who look as much for what isn't there as what is.

Shelfware isn't going to catch gaps in logs or other fairly simple tricks to cover one's tracks. Someone who has actually spent time penetrating other systems and had to think about these things just might. These people are not cheap, and there aren't many of them.

Those networks which are defended by teams of the best will not fall to your average state-level, organised crime or industrial espionage hacking crew. They will understand, amongst other things, that eggshell security doesn't cut it: http://www.theregister.co.uk/2015/08/22/next_generation_security_startups_emerge/That breaches will occur will have been foreseen, and they will have built traps, isolation procedures and much, much more to counter attacks.

To get into these networks you need more than a state-level hacking apparatus. You need a hacking industry. You need to have billions of dollars being spent every year to identify new zero-day exploits, employ professional spies to gather data and be able to perform physical attacks against networks (such as compromising data centres or backhaul data links).

No one nation – not even the US – can pull this off. Developing this level of capability takes international cooperation. It takes the cooperation of nations with private industry. It requires tens – if not hundreds – of thousands of people working together to industrialise network compromise.

It really could have been North Korea

So, yes, Sony's breach absolutely could have been the work of the North Koreans. It is even a logical target if their goal is to train their hacking team against a live target. North Korea has no love for Japan or the US, so taking on what was once an iconic corporation in those countries might have some symbolism.

More to the point, Sony was soft. It wasn't expecting an attack, it wasn't particularly well defended, and it didn't have the resources (that larger, more profitable corporations have or are developing) to react in real time.

I don't buy the proposed political motivations of North Korea hacking Sony one bit. Sony is a stupid target if you want to make an actual statement. But it is exactly the right target to train against.

We are all viable targets. Even if we are not a tempting target because what we have squirreled away on our networks, we might just be useful to train against. It could be that the only purpose the compromise of our network serves is target practice for someone going after meatier game.

Given the above, it's time for us to stop thinking that quality attackers are few and far between, or that our networks will only be attacked for good reason. It's time to make network security something we constantly evolve and refine and hire full-time professionals to oversee.

Cryptsy has had problems for some time now and it’s time to let everybody know exactly why. These problems were NOT because of any recent phishing attacks, or even a ddos attack, nor does it have anything to do with me personally.About a year and a half ago, we were alerted in the early AM of a reduction in our safe/cold wallet balances of Bitcoin and Litecoin, as well as a couple other smaller cryptocurrencies. After a period of time of investigation it was found that the developer of Lucky7Coin had placed an IRC backdoor into the code of wallet, which allowed it to act as a sort of a Trojan, or command and control unit. This Trojan had likely been there for months before it was able to collect enough information to perform the attack. It does not appear that this was the original developer for LK7, as on 5/22/2014, we received this message from the new developer who wanted to maintain the codebase:—Hello,Lucky7Coin is not maintained and I would like to take care of it. I have announced that on bitcointalk.org in Lucky7Coin thread. You’re the only exchange for this coin and I hope you will let me take care of it. I’m responsible. You don’t have to be afraid of errors or forks. I’m developing multipool and I know bitcoin internals and protocol.https://bitcointalk.org/index.php?topic=295157.msg6861797#msg6861797For a start I’ve changed irc network, so clients could synchronize blockchain. Please upgrade as soon as you can.Github repo:https://github.com/alerj78/lucky7coinBranch “master” will always be for stable version, branch “devel” could be dirty. In a 2-3 weeks I’ll release new version with p2pool support and checkpoints. Before that I’ll contact you to check few blocks hashes for checkpoints and make sure there is no fork.I hope we can cooperate and make this coin live again!Jack—These are the approximate figures taken:Bitcoin: 13,000 BTCLitecoin: 300,000 LTCThis of course was a critical event for Cryptsy, however at the time the website was earning more than it was spending and we still have some reserves of those cryptocurrencies on hand. The decision was made to pull from our profits to fill these wallets back up over time, thus attempting to avert complete closure of the website at that time. This worked fine for awhile, as profits decreased due to low volume and low Bitcoin prices, we would adjust our spending accordingly. It wasn’t until an article from Coinfire came out that contained many false accusations that things began to crumble. The article basically caused a bank-run, and since we only had so much in reserves for those currencies problems began. Our current customer liabilities for BTC is around 10,000 BTC, so as you can see we would like to see the Bitcoins returned for both our users and for ourselves.Here are the transaction details from the Bitcoin wallet:https://www.walletexplorer.com/wallet/0c07e0bec1002bd2As you can see, 2014-07-29 13:17:36 is when the event occurred. A very interesting fact here, however, is that those Bitcoins have not moved once since this happened. This gives rise to the possibility they can be recovered. In fact, I’m offering a bounty of 1000 BTC for information which leads to the recovery of the stolen coins.If you happen to be the perpetrator of this crime, and want to send the coins back no questions asked, then you can simply send them to this address: 1KNi4E4MTsF7gfuPKPNAbrZWQvtdQBTAAaIf they are returned, then we will assume that no harm was meant and will not take any action to reveal who you are. If not, well, then I suppose the entire community will be looking for you.Some may ask why we didn’t report this to the authorities when this occurred, and the answer is that we just didn’t know what happened, didn’t want to cause panic, and were unsure who exactly we should be contacting. At one time we had a open communication with Secret Service Agent Shaun Bridges on an unrelated matter, but I think we all know what happened with him – so he was no longer somebody we could report this to. Recently I attempted to contact the Miami FBI office to report this, but they instead directed me to report it on the I3C website. I’ve not heard anything from them.I think the only real people who can assist with this are the people of the Bitcoin community itself.Trades and withdrawals will be suspended on the site indefinately until some sort of resolution can be made.Here are our options:1. We shut down the website and file bankruptcy, letting users file claims via the bankruptcy process and letting the court make the disbursements.- or –2. Somebody else comes in to purchase and run Cryptsy while also making good on requested withdrawals.- or –3. If somehow we are able to re-aquire the stolen funds, then we allow all withdrawal requests to process.I’m obviously open to any other ideas people may have on this.If you have information, you can email reward@cryptsy.com– Update 2016/01/15 7:31pm –I will be posting transaction ID’s for other alt coins soon. Updates will be appended to this post.We are clearing out the order books for now and placing all funds back into user accounts.Because of the phishing attempt earlier this week, we are performing a forced password reset on all accounts upon next login. We are getting some helpful information to our reward email and want to thank all who are helping to find the culprit. The vast majority of our users want the Cryptsy exchange to continue operating.Many are suggesting other options other than the 3 mentioned above:4. Spread the loss to all users in the system and allow trades to continue.5. Restrict withdrawals on short balanced coins, allowing withdrawals on a first come, first serve basis upon availability. 6. Place existing user balances of BTC, LTC into a frozen state and release funds as they become available from fees collected. 7. Find an investor or group who wish to invest into the operations or provide a loan.In any case, it is our intent to get every user their funds. Depending on what option or combination of options we end up doing, this may take some time.I’m seeking known leaders in the community who want to participate in an advisory board on how we can keep Cryptsy operational for the users.